Tax Exemptions You Will Want To Remember

Many taxpayers are not taking advantage of certain tax breaks simply because they are not aware of them or they just forgot about them. Here a few tax deductions or credits you will want to take advantage of.

Noncash Charitable Deductions: If you donated anything to Goodwill or other charities like them AND received a receipt for the value of the items donated. You can deduct this donation. If you donated, but didn’t receive a receipt, do not deduct your donation. If you are audited, the IRS will require a receipt.

Points Paid During Refinance: With interest rates as low as they are, several people are taking advantage of this and refinancing. Points paid to refinance your mortgage loan can be deducted on a monthly basis over the life of your new loan.

Health Insurance Premiums: These premiums you pay, including some long-term-care premiums based on your age and medicare premiums, could be deductible. Your medical expenses need to exceed 7.5% of your adjusted gross income before you can benefit from this.

Energy Savings Home Improvement Credit: This is a great credit because they are dollar-for-dollar deduction. Be sure to speak with a tax expert so you understand what tax savings you can take advantage of by making your home more energy efficient.

Retirement Tax Credit: This tax credit is designed to give moderate to low income taxpayers an incentive to save for their retirement. If you contribute to your retirement account, that money is not currently tax.

Cost of moving for your job: Job-hunting expenses are not deductible when looking for your first job, but the expenses you incur when moving for your first job are deductible. In order to qualify for this credit your first job must be at least 50 miles from your old home.

Child Care Credit: This credit is better than a deduction because it reduces your tax bill dollar for dollar. Please consult with a tax expert to see how this credit can impact your tax return.

Taking advantage of these tax deductions and credits should help keep more money in your pocket.